ISU TECHNOLOGY STARTUPS - COMMERCIALIZATION PLAN
Information Needed from Start-Up Companies for Discussions Leading to Licensing of ISU Developed Intellectual Property
The ISU Research Foundation, Inc. (ISURF) owns and manages intellectual property for the benefit of Iowa State University. The right to use ISU intellectual property is conveyed to a startup in a legal agreement called a license. The substantial expense involved in prosecuting and managing patents makes OIPTT/ISURF an investor in any startup that is provided a license. Therefore, prior to entering license negotiations, OIPTT/ISURF requires an understanding of how your startup anticipates doing business, which will provide the basis for arriving at license terms that are fair to both ISURF and the company.
The plan for doing business should be communicated to OIPTT/ISURF in a business plan. OIPTT/ISURF does not require a detailed professionally produced business plan; however, the plan provided to OIPTT/ISURF should include as much that you can provide of the following information - this will also help you prepare to present to external investors.
- Explain how the company will generate income, i.e. what goods and services will be developed and commercialized by the company?
- Identify the ISURF technologies that you want to license.
- Explain how you will use the ISURF technology.
- Describe third party technology, if any, you will need to access in order to commercialize products and/or services. Are these technologies available to you through a license or other mechanism?
- Describe any regulatory approvals necessary to commercialize the technology.
- Describe the key partners you will need and what will they provide to make your company viable (marketing, sales, distribution, legal, technical, etc).
Markets and Value Proposition
- Describe the unmet market need for the company's products or services.
- Identify the core customer segments that will be the primary purchasers of the company's products or services. What are the respective market sizes in dollars? What is your initial target market? How have you validated your market assumptions?
- Identify known and anticipated products and services which can be viewed as a competitor to your product and/or service.
- Identify why your company has a sustainable competitive advantage over these products and/or services, and explain how the ISURF technology provides the company with a competitive advantage.
Economics and Profitability
- Provide a timeline from current state of development through proof-of-concept and then from proof-of-concept to commercial viability.
- Identify the investment required to achieve proof-of-concept and the investment required to reach commercial viability.
- What are your plans to source your capital?
- What is your target gross margin?
- Provide 3-5 years financial projections and estimate of how many years it will take to get the product to market.
Management and Ownership
- What type of legal entity will be used for the new venture (C-Corp, S-Corp, LLC, etc.)?
- Describe the anticipated structure of the company with regard to management, including the current role of each of the inventors in the company.
- Describe the facilities available to the company, including location of offices and labs, if any.
- What is the planned exit strategy: IPO, merger, acquisition, sub-licensing, other?
On-Line Resources for Business Plan Development
The following links provide information related to business plan development.
- ISU Pappajohn Center for Entrepreneurship, http://www.isupjcenter.org
- US Small Development Business Association, http://www.sba.gov
Click here for a graphic depicting the process for licensing intellectual property to a startup company.